Our view on petroleum politics: No pain, no gain on energy

Proposal to tax Calif. oil would undermine energy independence.

An immutable rule of energy politics is that whenever fuel prices rise, lawmakers and interest groups respond with ideas of dubious merit.

Republicans tend to favor tax breaks and subsidies for energy companies to encourage drilling. Democrats favor tougher auto mileage mandates and taxes on the energy companies' "windfall profits." Both parties profess support for alternative energy research.

Though these approaches might seem quite disparate, each is based on the false premise that someone else — oil companies, carmakers, research scientists — can be induced to solve the nation's energy woes. Consumers need not be burdened with higher energy costs that would alter behavior on their part and encourage the private sector to sink real money into green technologies.

Nowhere is this better illustrated than in a ballot initiative in California known as Proposition 87. If approved on Tuesday, it would impose a tax of up to 6% on oil produced in the state, which would generate $225 million to $485 million per year, until $4 billion is collected, for alternative energy research.

As a political contest, this one is mammoth. With money from Hollywood and Silicon Valley on one side and Big Oil on the other, the battle has attracted $150 million in contributions, making it the most costly ballot measure ever.

But as an energy policy, it is minuscule and full of the usual gimmicks. It serves people's desire to see Big Oil punished for selling a product consumers want. At the same time, it asks nothing of those consumers.

Because the tax is only on the 230 million barrels of oil produced annually in the Golden State, about 37% of its consumption, it would be difficult to pass it along to drivers. Lest someone try, the measure includes specific language prohibiting that.

Moreover, by placing a tax on domestic oil that does not apply to imported oil, Prop 87 would encourage companies to produce less in California and import more, setting back the cause of energy independence and further enriching some of the world's worst regimes.

If the nation is ever to break its oil addiction, alternative energy research is a worthy endeavor. But an additional $4 billion over several years is not likely to have much impact. During the past five years, the federal government and private industry have invested nearly $46 billion in conservation and alternative energy technologies, according to a study by the University of Texas and the Institute for Energy Research.

In the long run, an alternative-energy breakthrough is far more likely to come when rising oil prices prompt widespread investment in newly profitable technologies. That's not a subject the free-lunch crowd in California and elsewhere wants to confront. Instead, they want to give people the false impression they are doing something meaningful without making any sacrifice. That can hardly be called sound energy policy.